G7 sees global economy upturn

Monday 11 February 2002 00:00 BST

FINANCE ministers and central bankers attending the G7 meeting in Ottawa all agreed that the recovery in the world economy has begun, although risks still remain. The US and Europe can expect to see growth strengthening as the year progresses.

Paul O'Neill, the US Treasury secretary, said: 'We see more signs every day that a recovery is under way.' Wim Duisenberg, president of the European Central Bank, said: 'The risk of recession in the world economy, which could not be fully ruled out in late 2001, seems now to have faded away.'

The G7 meeting welcomed recent actions by the Argentine government, including the floating of the peso. It urged close liaison with the International Monetary Fund and the international community.

There remained an impasse on the international disagreement over America's plan to pay more aid to poor countries in the form of grants rather than development loans. But some progress was made towards a compromise, involving a rise in the proportion of grants paid to the very poorest countries, or for specific social projects.